UK stationery chain Office Outlet has appointed two partners from professional services network Deloitte to act as joint administrators.
This move is expected to affect 1,200 jobs, reported the BBC.
According to the administrators, the retailer has been struggling due to a signification drop in demand for stationery supplies, and reductions in credit terms from suppliers.
Deloitte joint administrator Richard Hawes was quoted by the news agency as saying: “The company has recently experienced a reduction in credit from key suppliers, given the economic outlook, which has severely impacted the financial position of the company.”
Partly owned by Hilco, Office Outlet will continue its business until a potential buyer is found.
Office Outlet chief executive Chris Yates was quoted by BBC as saying: “Over the last two years, the business has been transformed from the heavily loss-making old Staples business to a near break-even modern multichannel retailer.
“However, additional growth capital was required to continue delivery of the next stage of the management buyout business plan.
“Despite being highly impressed by the Office Outlet story, potential investors have held back due to retail sector sentiment and the general level of uncertainty.”
Last August, the retailer filed its company voluntary arrangement (CVA) and selected British law firm Shoosmiths to advise it.
Under the CVA, the company closed four stores and retained the remaining 95 stores, as well as its online business.
Last September, Office Outlet shareholders approved the CVA by allowing it to access a three-year rent holiday for 20 stores, reported retailgazette.co.uk.